Denial of application for Remote Pilot, waivers, or suspension/revocation, or a civil penalty.  Jail time of up to 1 year A required checkride with the FAA

Not to exceed 30 days. Within 10 days. Any time.

the Remote PIC.  the controlling agency. Air Traffic Control.

No, Part 107 requires a Remote Pilot certificate. Yes, as a Student Pilot they can. Yes, under the direct supervision of a remote Pilot in Command. 

Finish the mission by paying extra attention to the surrounding. Land as soon as practical and determine if the mission can be restarted without a Visual Observer.  Continue the mission without ...

They can maintain line of sight and without loss of control.  They briefed each other before the flight. They are in radio contact the entire time.

Remote Pilot Certificate, Registration Card, and a copy of the Completion Certificate for the Recurrent Training.  Remote Pilot Certificate and your logbook. Remote Pilot Certificate and Registration Card.